Strange diversion of conditional inflation forecasts: At the ECB Meeting Draghi expected inflation to rebound to 1.2% next year and 1.6% in 2018.The SNB, however, predicts 2017 inflation at 0.2% and 2018 at 0.6%.
YoY CPI Inflation in Germany is at 0.4%, in France 0.3%, in Italy and Spain near or under zero. Switzerland sits on a real estate bubble that sooner or later will translate into rents and prices. Rents in Spain have fallen by 4.4% against last year, after their real estate bust some years ago.Wages in Switzerland are up 0.8% but they have risen less in Italy or Spain.
One of these two forecasts must be wrong! My guess is that Draghi will be wrong.

Swiss National Bank leaves expansionary monetary policy unchanged

The Swiss National Bank (SNB) is maintaining its expansionary monetary policy. Interest on sight deposits at the SNB is to remain at–0.75% and the target range for the three-month Libor is unchanged at between –1.25% and –0.25%. At the same time, the SNB will remain active in the foreign exchange market, as necessary. The negative interest rate and the SNB’s willingness to intervene in the foreign exchange market are intended to make Swiss franc investments less attractive, thereby easing upward pressure on the currency. The Swiss francis still significantly overvalued.

[unable to retrieve full-text content]Despite her incredible money printing and FX purchases, the SNB has many roots in the Austrian School of Economics, a school that maintains that money printing leads to price inflation. One of the major Austrian economists was Carl Menger.

[unable to retrieve full-text content]This press release presents the results for a Swiss National Bank (SNB) survey on turnover in foreign exchange and derivatives markets. The request for data was sent to 30 banks that operate in Switzerland and have a sizeable share in the foreign exchange and over-the-counter (OTC) derivatives markets. These banks reported the turnover of their domestic offices.